International home buyers still keen on investing in U.S.

Attractive home prices, economic stability and favorable exchange rates continue to drive international buyers to the U.S. to purchase properties and make real estate investments.

According to the National Association of Realtors 2014 Profile of International Home Buying Activity, from April 2013 through March 2014, total international sales were estimated at $92.2 billion, an increase from $68.2 billion from the same period last year. Four states accounted for 55 percent of the total reported purchases by international buyers and recent immigrants: Florida, California, Arizona and Texas.

Florida remains the destination of choice, claiming 23 percent all foreign purchases. California ranked second with 14 percent, Texas 12 percent and Arizona 6 percent. The top five cities searched online by international buyers in 2014 were Los Angeles, Miami, Las Vegas, Orlando and New York City.

Canada, China, Mexico, India and the U.K. made up approximately 54 percent of all reported international transactions. Canada's share of purchases was 19 percent in 2014, down from 23 percent in 2013. China led in dollar volume, purchasing an estimated $22 billion with an average sale cost of $590,826. China was also the fastest-growing source of transactions, accounting for 16 percent of all purchases, up 4 percent from last year. Mexico ranked third with 9 percent of sales, and India and the U.K. both accounted for 5 percent.

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When purchasing property in the U.S., foreign buyers consider proximity to their home country, the presence of relatives and friends, job and educational opportunities and climate. The survey found European buyers are generally attracted to the warmer climates of Florida and Arizona, while Asian buyers like the West Coast. Buyers from India tend to settle in states that have large information technology companies, such as California, New York and North Carolina.

In 2014, nearly 60 percent of reported international transactions were all cash. "If they can, foreign buyers will make all-cash purchases because mortgage financing can get complicated for them since they typically do not have a U.S. credit history, a Social Security number and other documentation required by U.S. lenders," said Kenneth Chan, premier mortgage consultant with HSBC, who has helped many agents close a number of international transactions in the Bay Area.

International sales tend to be handled by specialists, according to Steve Brown, president of the national Realtor group. "Realtors who have completed the Certified International Property Specialist designation have received specialized training

and are prepared to help clients with the unique difficulties of being an international buyer," said Brown. "CIPS designees understand the challenges buyers face when purchasing property in the U.S., and have the experience and expertise to help them navigate the complex, time-consuming and overwhelming world of international real estate."

As Realtors come across more foreign buyers, a number of Realtor associations have begun offering the designation course on a regular basis. David Tonna, president of the Silicon Valley Association of Realtors, announced that the local trade association will be offering the CIPS Institute on Nov. 17-21. The course is open to all real estate professionals, regardless of their affiliation.

"Silicon Valley is one of the places where foreign buyers are purchasing homes. The knowledge and training that the CIPS courses provide will set Realtors apart from others when it comes to buying and selling property here and around the world," said Tonna.

The week-long CIPS Institute includes the two required core course and three elective courses to fulfill the classroom requirements of the designation. For more information, contact the Silicon Valley Association of Realtors at 408.200.0100.